Super Apartment Markets

While Tom Brady and the New England Patriots will face Matt Ryan and the Atlanta Falcons on the field this Sunday for the ultimate bragging rights, off the field, another competition is occurring to determine which city is the superior multifamily market.

football-field-800x620Two super multifamily markets are being represented in this Sunday’s Super Bowl LI: Boston and Atlanta.

While Tom Brady and the New England Patriots will face Matt Ryan and the Atlanta Falcons on the field this Sunday for the ultimate bragging rights, off the field, another competition is occurring to determine which city is the superior multifamily market.

Both Boston and Atlanta have unquestionably earned the right to be finalists. The metros both have excellent multifamily markets: solid performance and excellent outlooks. So both of these more or less equally sized multifamily markets (about a half million units) are “winners” as the sportscasters would say.

Boston scores solidly over Atlanta in three categories: lower vacancy, lower change in vacancy in 2017, and in higher value of apartment units. That’s 21 points (multifamily kickers always score the extra point). Boston also outplays Atlanta slightly in two other categories: projected 2017 rental appreciation and 2016 net absorption. We give field goal points for each category, bringing Boston’s score up to 27.

Atlanta’s superior field dexterity in the apartment market shows up strongly in five categories: rent growth in 2016, net absorption in 2017, employment growth rate in 2017, total multifamily acquisitions in 2016, and 2016 investment compared to 2015. In all five cases, Atlanta exceeds Boston, giving the team 35 points. Atlanta also scores one field goal with a moderately higher employment growth number expected in 2017. Final score Atlanta is 38.

It’s a well fought game by two superb multifamily teams, but Atlanta takes it 38 to 27. Sorry, Brady.

This was first published on CBRE Capital Watch.